Economic realities drive the growth of cloud in Southern Europe

Southern Europe is experiencing an explosion of interest in cloud computing. The continued growth of global business, rising demand for more and better services, economic pressures to reduce costs and maximize investments, and interest in more sustainable business practices all make the cloud attractive to many enterprises. Increasingly companies are looking for a way to cope with complex IT infrastructures, and that’s where the cloud can also make a difference. This article details five key drivers for cloud adoption based on our own experience as well as in our work with other businesses as they’ve embarked on their cloud journey.

Telecom Italia and the cloud

At Telecom Italia, we pioneered many of the technologies used in our “Nuvola Italiana” public-cloud platform on internal systems. Due to the size of our organization, the geographic distribution, and the variety of the services we offer, internal IT was already experiencing many of the same pressures that are now coming to bear on the wider market.

We began with server virtualization as part of our Next-Generation Data Center (NGDC) project, together with automation of many repetitive tasks. This allowed us to take control of the rapid growth of distributed systems that happened as we moved away from the mainframe.

The NGDC project allowed us to reduce both capital and operational expenditures (CapEx/OpEx) through server consolidation, while also delivering visible improvements in service delivery times. In some cases, the improvements went from months down to hours or days. End-to-end automation and process reengineering were key to this effort and enabled us to reduce our investment in servers by 50 percent, despite 50 percent growth in the number of those servers. We also estimate energy savings from this project at around 40 GWh/year, making us an Italian leader in what has become known as “green IT.”

Today, we are taking these efforts to the next level with a "cloud-first” policy, by which our own services are delivered using cloud infrastructure by default unless there is a very good reason to use different technology. Very few applications are exceptions to this rule. The internal cloud is currently segregated from the public cloud that is accessible to our customers, but the technology and best practices are shared between the two environments.

Five drivers for a move to the cloud

Based on our experience, we see five key drivers for cloud adoption: (1) economics and investment, (2) access to the latest technology, (3) required network capabilities, (4) compliance and security, and (5) organizational realignment.

1. Economics and investment

In the past decade or so, corporate and governmental IT departments have been reacting to the consequences of the migration from mainframes to distributed systems. The wholesale replacement of IT systems required by that migration and the subsequent explosive growth in the size of the IT estate led to large IT expenditures, which in turn led to a push for cost control and increased governance. Both private and public sector organizations began to place ever-increasing demands for flexibility, speed, and elasticity upon their IT infrastructure and processes, with the goal of bringing new services online more quickly and efficiently.

The current economic climate has an unquestionable impact on these trends. Especially in Southern Europe, many companies are reluctant to invest in IT infrastructure due to its high cost and rapid obsolescence. In contrast, the idea of contracting with a third party to provide and manage IT is very attractive, provided the level of service can be maintained or improved compared to on-site IT.

Virtualization technologies and green IT, together with the development of a network of modern, highly interconnected data centers, are the enabling factors for these new cloud offerings — and for meeting users’ needs. The differentiator among the various offerings that share these common underpinnings will be a strong commitment to ongoing research and development. This will reassure customers that their chosen technology provider will continue to innovate and improve its offering as the cloud market develops and matures.

Support services layered over the technological infrastructure will also be key to value realization in the cloud market. These support services will need to offer end-to-end coverage, potentially from client devices to the backbone networks and all the IT infrastructure in between. The new cloud operating model needs to be designed for and evolve around the user with the goal of ensuring ease of access to services, transparency of information, rationalization of communications, and clear and measured service level agreements (SLAs).

2. Access to the latest technology